What Would You Explain to a First-Time Investor?

Question

There’s a lot of information online about real estate financing, but the terminology alone can be overwhelming.

LTV.LTC.ARV.Points.Draws.Term.Exit strategy.

For experienced investors, these are familiar concepts.

For someone entering their first project, they can feel like another language.

If you could explain one financing concept to a first-time investor in plain English, what would you choose?

Chris Colton · Answer

I would start with the monthly payment. It is the amount that has to be paid every month, and I look at whether the rent covers it once taxes and insurance are in. When it does not, I step back and keep learning.

Chris Seveney · Answer

Impacts of leverage.

What Would You Explain to a First-Time Investor?

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